A Resident of Virginia was left with a major error on one of her credit reports from TransUnion after her husband of 40 years died of a heart attack last August. While she was pushing through grief, she had to focus on finances. She had to downsize and sell her family home. She thought everything was settled, and had applied for a car loan.
Upon applying she did not qualify for a low interest rate from the car dealership. The 12% interest rate she received would have cost her more than $100 extra a month. She is on a fixed income, so every dollar counts.
TransUnion mistakenly showed that she had a PayPal credit card with a balance due of $1,200 — an error that really hurt her credit score. This account was paid off. Equifax and Experian correctly reported the account as paid off and closed.
She filed multiple disputes with TransUnion, but like many others, the mistake was not fixed. This story comes from Consumer Reports - who reached out to the credit bureau about her situation and successfully got it corrected.
Many Americans are unsure of what to do when they find a mistake in their credit report, especially after making multiple disputes to no avail. Consumer Reports created a recent analysis where they asked over 5,000 volunteers to get a copy of their credit report and check for errors. This study was not nationally representative, but it did find errors within these few volunteers that are alarming. Just over 1/3 of volunteers found at least one error.
As in such case, mistakes can be serious and can dramatically lower a person’s credit score. In turn, this can make loans more expensive. Inaccurate information in your report can also affect decisions from insurers and employers.
Consumers are often faced with roadblocks when trying to correct errors or even just obtaining access to their reports. The post-pandemic economy is coming back to life and consumers are having their life opportunities stripped from them.
The large number of errors from this small study is an indication that the credit reporting system is failing American consumers. Credit reporting is a part of our public infrastructure which is a necessity for consumers to participate economically. The Big Three — TransUnion, Equifax, and Experian have all the power over our financial destinies.
For about 1 in 10 people in Consumer Reports study, errors were related to their financial data: unrecognized payments, payments wrongly reported as late, or debt in collections that were mistakenly in their name. All of these could easily lower a person’s credit score. When a debt is reported as in collections or payments are reported as late, your score could drop as many as 100 points.
More common were mistakes in personal information. One man stated that his bank account was hacked several years ago and an address that he never lived at wound up on his credit report. It took him several years to get the address removed from all three of his reports.
A new rise are errors in reporting among people who had sought financial help during the COVID-19 pandemic. In the early days of the crisis, legislation offered forbearance to people with certain student loans and mortgages, meaning they could put off payment for several months with no penalty. But 15% of people who had an account in forbearance noticed that their accounts were reporting as “not current”.
Trouble Accessing Reports
Some people have found that obtaining their credit report was confusing or almost impossible. A few of them said that they were locked out for failing to answer the credit bureau’s security questions that were outdated. One lady failed an online security quiz and had to make copies of her drivers license and Social Security card and send a request for her report via mail. This caused her a lot of stress that her sensitive information could be stolen in transit. She stated that it took several weeks to get all of her reports back.
Credit bureaus have turned to requiring more detailed information for security questions, but many people do not remember how much their mortgage payment was, or which bank may have serviced their mortgage 10 years ago.
To make matters worse, some of the security information you are asked about is based on inaccurate data in your report. One woman reported that she answered the questions correctly but because the answer didn’t match the wrong information they had on file, they wouldn’t allow her access to her reports.
Unexpected Charges
The credit bureaus are allowing consumers to get a free copy of their credit report every week through April 20, 2022 and not just annually, as they did in the past. Some people reported that when they tried to access the free reports, they had to provide a credit card and pay anywhere from $1 to $30 to get their report. A woman from Virginia was trying to sort out a credit card issue and accidentally signed up for a monitoring subscription for $30. The credit reporting websites and be sneaky at getting consumers to buy a product.
How to Find, Dispute, and Fix Problems
It is important to check your credit report often, and with the free weekly access this year, it makes it easier from www.annualcreditreport.com.
You should first look at your basic information. Make sure your name, address, SSN are all correct and spelled correctly. You should immediately dispute anything that you see in error.
Next, you should make sure that your credit information is yours and that it is accurate.
It is best to send a complaint/dispute through certified mail so that you know an actual person is looking into the information. The online disputes are convenient but are coded and may not get you the results you need.
By law, the credit bureaus have 30 days to respond to your dispute.
f you still encounter errors, or they are not fixing the errors, you can contact us for help and we can look into your situation.